How Democrats Can Win the Climate Debate

If Democrats want to win on climate policy, they must think fast and move quickly to regain control of the debate. Last week was the opening round of the national climate fight, and the Democratic Congress was nearly knocked out.

It began on Tuesday with the introduction of a major climate bill by Democratic Congressmen Waxman and Markey. The proposal made a fateful choice: it threw out President Obama's "Apollo" plan for investing $150 billion in clean energy and focused instead on meeting the demands of leading environmental organizations, emphasizing cap and trade regulation and a laundry list of electricity and efficiency standards.

Meanwhile, the response to climate legislation in the Senate was swift and harsh, with Republicans deftly maneuvering to secure the political high ground. Senator Thune (R-SD) introduced an amendment to the budget (which as originally proposed had included revenues from carbon cap and trade) declaring that any climate legislation should "not increase electricity or gasoline prices," which quickly passed 89 to 8. Senator Ensign (R-NV) then proposed an amendment stating that climate policy should not result in higher taxes on the middle class, passing unanimously (98-0). These votes effectively put all but a handful of Democratic Senators on the record opposing policies to raise the price of dirty energy -- the central purpose of cap and trade regulation, including the provisions at the heart of the Waxman-Markey bill.

What went wrong? The Democratic Congress made a critical mistake in following the direction of leading green groups like Environmental Defense Fund and the Natural Resources Defense Council. By tossing out Obama's energy investment plan and focusing on carbon pricing and regulation, Democrats allowed Republicans to quickly and easily frame the entire debate around increased energy prices and economic costs. That's a fight Republicans take up with relish -- and one they will surely win.

This isn't a surprise. Proposals to increase dirty energy prices have consistently failed since President Clinton's "Btu tax" collapsed in the early 1990s, and a recent poll showed that 89 percent of the U.S. public is worried about increases in the price of gas and fuel. Last month, for the first time in 25 years, a new Gallup poll also found a majority of Americans are willing to sacrifice environmental protection to strengthen the economy. In the midst of economic crisis, Americans are far more worried about keeping their jobs and paying their energy bills than they are about global warming.

If the Democratic Congress stays the course, one of two outcomes is practically inevitable. Either the national climate agenda will collapse, or any cap and trade provisions passed through Congress will be so weak as to be largely irrelevant for reducing carbon emissions. To secure passage, the carbon regulations will become so watered down with provisions to limit the impact on energy prices that any resulting price on carbon emissions will be almost negligible.

And if that's not bad enough, the Republicans have set a trap that Democrats are poised to spring. Even if Democrats secure passage of a weak climate bill riddled with cost-containment provisions, the GOP will vehemently attack them in the 2010 midterm elections for breaking their "promise" not to pass legislation raising energy prices or taxes. As long as climate proposals primarily focus on regulation and carbon pricing, Democrats will be handing Republicans a blunt political weapon.

So how can Democrats win? They must quickly follow President Obama's lead by shifting the focus of climate legislation from pollution regulation to bold government investment in the clean energy economy. Obama has consistently placed clean energy investment at the center of his economic agenda, from his signature campaign proposal for a $150 billion clean energy project, to his advocacy for energy investments throughout the economic stimulus debate. The result was clear: 78% of voters expressed strong support for clean energy investment, according to a post-election poll, and the stimulus package was a success.

Fortunately, President Obama isn't the only one who gets it. As Speaker Nancy Pelosi summed it up in January: "Cap-and-trade is there for a reason. You cap and you trade so you can pay for some of these investments in energy independence and renewables."

And in fact, Congressmen Markey himself has been a staunch advocate of major investments to catalyze the clean energy economy. When he introduced his ideal vision of a climate bill in 2008, Markey declared that Congress should use the money from carbon pollution permits to "invest tens of billions" each year to develop and deploy "the cutting-edge low-carbon energy technologies that will power America's future."

President Obama and Speaker Pelosi have it right (and Markey had it right last year): a "New Apollo Project" for clean energy -- at least $150 billion in direct public investment over ten years (and ideally much more), funded by modest carbon pricing or deficit spending -- is far more robust than pollution regulation. Whereas a debate about carbon regulation emphasizes economic costs and increased energy prices, a debate about clean energy investment puts the enormous public benefits at the front and center: creating millions of jobs, promoting U.S. growth industries and competitiveness, developing new energy technologies, and securing the nation's energy independence.

By focusing climate policy on direct public investment in the clean energy economy, Democratic leaders position themselves on strong political ground and force Republicans to oppose job creation, economic revitalization, and energy independence.

The time to act is now. The draft climate bill released last week will be debated when Congress returns from April recess. The Democratic Congress must move quickly onto the offensive and declare that a New Apollo Project for clean energy is non-negotiable. And that effort must be more than just rhetorical -- it must be matched with a significant shift in policy design, one that places clean energy investments at the center of climate legislation. That's the debate Democrats can -- and must -- win.

Teryn Norris and Jesse Jenkins are Project Director and Director of Energy & Climate Policy at the Breakthrough Institute.